Step One: Protect What You Have Left

To paraphrase an ancient Chinese curse, we live in interesting times. Indeed, it may be appropriate to abandon subtlety and state that we live in dangerous times. Many of us are experiencing significant loss of income as a result of either unemployment or reduction of business revenue. Those of us who are not yet in this position have seen it happen to neighbors, friends or colleagues. We are, or should be, afraid that this could happen to us. We have all suffered serious depreciation of our investment assets. Our homes are devalued, our retirement plans are decimated and our nest egg is shrinking daily, with no end in sight.

There is no shortage of financial planners and investment managers eager to offer free advice in these troubled times: “Buy Low”, “Hoard Cash”, “Invest in Bonds”. Yet, all of these advisors ignore the first, most obvious and most important piece of advice: PROTECT WHAT YOU HAVE LEFT!

Now is the time for each of us to adopt a plan to protect our current assets from threats that may arise as a result of further financial deterioration. If we lose our jobs, if our income further declines, if our savings vanish: Will we be able to pay all of our debts? Will we go further into debt? Could we lose our assets? Could we get sued?

Although asset protection strategies may be adopted at any time, such strategies are most effective and least expensive when they are adopted early, while all debts are current. Consider transferring assets to legally protective entities like family limited partnerships that will, in effect, erect “bullet-proof shields” around your home and other assets. Consider moving your nest egg to a safer jurisdiction — one where banks have not failed and where the black plague of sub-prime mortgages and credit default swaps has not reached.

Whatever financial strategies you chose to follow, your fist step should be a legal strategy: PROTECT WHAT YOU HAVE LEFT through timely, legal asset protection.